Order: 2011

- 1

- 12 Served: January 14, 2011



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 14 th day of January, 2011

Essential Air Service at

FORT DODGE AND

MASON CITY

, IOWA

Under 49 U.S.C. 41731 et seq

. DOCKET DOT

- OST

- 200 1

- 10682

DOCKET DOT

- OST

- 2001

- 10684

ORDER REQUESTING PROPOSALS Summary By this order, the Department is requesting proposals by March 1

, 201 1

, from carriers interested in providing essential air service (EAS) at Fort Dodge and Mason City

, Iowa

, for a new two

- year period, beginning June 1, 2011

, with or without subsidy.

Background By Order 200 9

- 4

- 20

, April 27, 2009 , the Department selected Mesaba Aviation, Inc., d/b/a

Delta Connection ( Mesaba ) to provide subsidized EAS to Fort Dodge and Mason City

, Iowa

, through May 31 , 201 1

. Under that order, the Department authorized subsidy for Mesaba consisting of eighteen round trips per week over a Fort Dodge to Mason City to Minneapolis routing

. All of the service was to be provided with 34

- seat Saab 340 aircraft for a total annual subsidy of $ 2,225,213

. By Order 2010

- 2

- 30 the Department approved an alternate service pattern decoupling Fort Dodge from Mason City , such that both communities would receive nonstop service

. Under th at service pattern, Mason City would continue to receive 18 nonstop round trips per week; Fort Dodge, in lieu of receiving 18 one

- stop round trips per week, agreed t o 14 nonstop round trips per week, with all service to Minneapolis.

Request for Proposals As the end of the current rate term approach es , we are here by requesting proposals from carriers interested in providing service at Fort Dodge and Mason City

, with or without subsidy, for the two

- year period beginning June 1, 2011 . Carriers should file their proposals by March 1

. S taff will then docket the proposals, thereby making them public. Shortly afterwards, we will provide a summary of the proposals to the communit ies and S tate and as k them to submit their final comments. We will give full consideration to all proposals filed in a timely manner. 1

1 Carriers should not expect the Department to accept late filings. In cases where a carrier proposes to provide essential air service without subsidy and we determine that service can be reliably provided without such compensation, we do not proceed with the carrier

- selection case. Instead, we simply rely on that carrier’s subsidy

- free service as proposed.- 2

-

Interested carriers should prepare their proposals with every expec tation that their initial proposals will also be their final and only proposals. We retain the discretion to negotiate proposals with carriers when we deem it desirable. We also retain the discretion to reject outright all unreasonable or unrealistic proposals and , if necessary, solicit a new round of proposals. However, we anticipate that negotiation or rejection will remain only occasional exceptions to the rule.

We are here providing interested carriers with some basic information to serve as guid ance when they prepare their proposals, but we will not prescribe a precise format for their proposals. We expect proposals to adequately describe the service being proposed and the annual amount of subsidy being requested. The applicants can make their own judgments as to the level of detail they wish to present; however, they might want to include proposed schedules as well as supporting data for their subsidy requests, such as projected block hours, revenues

, and expenses. We strongly encourage clear, well

documented proposals that will facilitate their evaluation by the affected communities and the Department. We do not anticipate any change in our selection criteria, or in the general provisions governing subsidy payments for essential air service. 2

With specific respect to Fort Dodge and Mason City , we expect proposals consisting of

two nonstop round trips per day at each community if 30

- or 34

- seat equipment is provided

, or three nonstop round trips a day with 19

- seat aircraft , and more frequencies

with smaller aircraft . We may subsidize additional frequencies if the affected community is served in conjunction with another community. As always, staff will work with the carrier to ensure service and subsidy is reasonable.

We encourage p roposals that meet the communit ies ’ requirements in an efficient manner. Carriers are also welcome to propose more than one service option, if they choose; they need not limit themselves to the current service pattern if they envision other, potentially

m ore attractive service possibilities

– different hubs, or longer terms for the contracted

service

– with subsidy requir e ments that remain competitive.

We encourage carriers to work with the communities in advance of the due date for proposals when proposa ls can still be adjusted so that they can craft them to best meet the

communit ies ’ needs. In addition, carriers should be very clear as to whether a specific community’s proposal may be considered on a stand

- alone basis, or whether it should be considered as part of a larger, inseparable package with another community. As always, we will fully consider the communit ies ’ views before making a long

- term carrier

selection decision.

New Filing Procedures Carrier proposals should be submitted to the Department with all materials merged into a single document. In addition, because the document will be published on Regulations.gov, each page should be formatted to be viewed online.

2 In selecting a carrier to provide subsidized essential air se rvice in Iowa , 49 U.S.C. 41733(c) (1) directs us

to consider f

ive factors. (1) service reliability; (2) contractual and marketing arrangements with a larger carrier at the hub; (3) interline arrangements with a larger carrier at the hub; (4) community view s ; and

In addition

, The Consolidated Appropriations Act, 2008, Public Law 110

- 161

, provides that when selecting a carrier to provide EAS, the Department may consider the relative subsidy requirements, thus codifying a factor

that we have considered since the inception of the program. Interested carriers should also be aware that our general provisions governing essential air service will be included in the selection order as part of our authorization of subsidy for the selected service. Appendix C of thi s order contains those general provisions.- 3

-

Historical Traffic In order to assist carriers in making their traffic and revenue projections, we have

included historical traffic for the communities in Appendix B

. For the year ended

October 31 , 2010, the most recent annual period, Fort Dodge generated an average of 22.6 enplaned passenger s per day, and Mason City an average of 39.9 enplanements per day

.

Other Carrier Requirements The Department is responsible for implementing various Federal statutes governing lobbying activities, drug

- free workplaces

, and nondiscrimination. 3 Consequently, all carriers receiving Federal subsidy to support essential air service must certify that they are in compliance with Departm ent regulations regarding drug

- free workplaces and nondiscrimination, and those carriers whose subsidies exceed $100,000 over the life of the rate term must also certify that they are in compliance with the regulations governing lobbying activities. Becau se the Department is prohibited from paying subsidy to carriers that do not submit these documents, the selected carrier will be required to submit them in order to receive subsidy. Interested carriers requiring more detailed information regarding these r equirements, as well as copies of the certifications, should contact the Office of Aviation Analysis at (202) 366

- 5903 . The Department is prohibited from paying subsidy to carriers that do not submit these documents.

Community Comments

Civic officials an d the State are welcome to submit comments on the proposals at any time. As noted earlier, we will provide a summary of the proposals to the civic parties and ask them to submit their final comments shortly after March 1 , the due date for carrier proposal s.

This order is issued under authority delegated in 49 CFR 1.56a(f) and re

- delegated to the

Directo r, Office of Aviation Analysis.

ACCORDINGLY,

1. The Department requests proposals from carriers interested in providing essential air

service at Fort Dodge and Mason City

, Iowa

. Carriers should submit their proposals, with subsidy if necessary, by March 1

, 201 1

. Proposals should be emailed to EAS@dot.gov, with the title “Proposal to Provide Essential Air Service at Fort Dodge and Mason City

, Iowa , Doc ket s DOT

- OST

- 200 1

- 10682 and 10684, respectively

. ” Questions regarding filings may be directed to Kevin Adams at 202

- 366

- 1047 or Kevin.Adams@dot.gov ;

2

. Th ese D ocket s will remain open until further order of the Department; and

3 . We will serve this order on the s ervice l ist for th is Docket.

3 The certifications are available on the web at http://ostpxweb.dot.gov/aviation/index.html.- 4

-

Persons entitled to petition the Department for review of this order under the Department’s Regulations, 14 CFR 385.50, must file such petitions within ten (10) days

after the date of service of this order. This order will be effective immediately, and the filing of a petition for review shall not preclude its effectiveness.

By:

TODD M. HOMAN

Director Office of Aviation Analysis
(SEAL)

An electronic version of this document is available on the World Wide Web at http://www.regulations.govAppendix A

Nonstop Great Circle Miles from Fort Dodge (FOD) Minneapolis ( MSP ) 168 Chicago ( ORD ) 325

Milwaukee ( MKE ) 321 Omaha (OMA) 123 Mason City (MCW) 60 Des Moines (DSM) 75 Cedar Rapids (CID) 136

Nonstop Great Circle Miles from M ason City (MCW) Minneapolis (MSP) 120 Chicago (ORD) 288 Milwaukee (MKE) 275 Omaha (OMA) 184 Fort Dodge (FOD ) 60 Des Moines (DSM) 113 Cedar Rapids (CID) 121

This map is provided by Sabre ® AirVision TM Profit Essentials and is being used with express permission of the copyright holder, Sabre Airline Solutions®.Appendix C

Example of General Terms and Conditions for Essential Air Service The carrier understands that it may forfeit its compensation for any flights that it does not operate in conformance with the terms and stipulations of the rate order, including the service plans outlined in the order and any other significant elements of the required service, without prior approval. The carrier understands that an aircraft take

- off and landing at its scheduled destination constitutes a completed flight; absent an explanation supporting subsidy eligibility for a flight that has not been completed, such as certain weather cancellations, only completed flights are considered eligible for subsidy. In addition, if the carrier does not sch edule or operate its flights in full conformance with the order for a significant period, it may jeopardize its entire subsidy claim for the period in question. If the carrier contemplates any such changes beyond the scope of the order during the applicab le period of these rates, it must first notify the Office of Aviation Analysis in writing and receive written approval from the Department to be ensured of full compensation. Should circumstances warrant, the Department may locate and select a replacement carrier to provide service on these routes. The carrier must complete all flights that can be safely operated; flights that overfly points for lack of traffic will not be compensated. In determining whether subsidy payment for a deviating flight should be adjusted or disallowed, the Department will consider the extent to which the goals of the program are met and the extent of access to the national air transportation system provided to the communit ies

.

If the Department unilaterally, either partially or completely, terminates or reduces payments for service or changes service requirements at a specific location provided for under this order, then, at the end of the period for which the Department does make payments in the stipulated amounts or at the s tipulated service levels, the carrier may cease to provide service to that specific location without regard to any requirement for

notice of such cessation. Those adjustments in the levels of subsidy and/or service that are mutually agreed to in writing b y the Department and carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contracts are subject to, and incorporate by reference, relevant statutes and Department regulations, as they may be amended from time to time. H owever, any such statutes, regulations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds are not currently available for performance under this solicitation beyond [DATE]. The Department’s obligation for performance un der this solicitation beyond [DATE], is contingent upon the availability of appropriated funds from which payment

for services can be made. No legal liability on the part of the Government for any payment may arise for performance under this order beyond [DATE], until funds are made available to the Department for performance. If funds are not made available for performance beyond [DATE], the carrier will receive notice in writing by the Department.

All claims for payment must be submitted within 60 days of the last day of service provided under this order